France: Tax waiver | KPMG | BE

France: Tax waiver on capital reclassification held “state aid”

France: Tax waiver

The General Court of the European Union today issued a judgment upholding a decision of the European Commission for France to recover approximately €1.37 billion from Électricité de France. The amount recovered represents “state aid” in the form of a waiver of the tax on the reclassification of rights in capital.

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The case is: EDF v. Commission, T-747/15 (16 January 2018)

As noted in a release [PDF 175 KB] from the General Court of the European Union, French legislation requiring EDF to restructure its balance sheet and to increase its capital was found, by the EC, to be a waiver by the French government of a tax claim valued at about €889 million (that is, this amount corresponded to the corporation tax due from EDF). The EC found that this waiver of tax constituted “state aid.”

The General Court today issued a judgment agreeing with the findings of the EC.

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